What is an Article 9 foreclosure sale?
What Is Article 9? Article 9 is an article under the Uniform Commercial Code (UCC) that governs secured transactions, or those transactions that pair a debt with the creditor’s interest in the secured property.
How does an Article 9 sale work?
ANSWER: Well, Jack, Article 9 of the Uniform Commercial Code governs the relationship between a debtor and its secured creditors. A secured creditor’s remedies include an Article 9 sale, the right to sell the collateral to a third party in a private or public sale without judicial proceedings.
Does Article 9 of the UCC apply to real estate?
In general, Article 9 of the Uniform Commercial Code applies only to security interests in personal property and fixtures, not liens on real property.
How does UCC Article 9 work?
Article 9 of the Uniform Commercial Code (UCC), as adopted by all fifty states, generally governs secured transactions where security interests are taken in personal property. It regulates creation and enforcement of security interests in movable property, intangible property, and fixtures.
What is a commercially reasonable sale?
A sale is commercially reasonable if it is a “disposition in any recognizable market,” is “otherwise in conformity with reasonable commercial practices among dealers in the type of property that was the subject of the disposition,” or is approved in a judicial proceeding, by a bona fide creditor’s committee, by a …
Does Article 9 apply to mortgages?
Transfer of Ownership Article 9 applies to both a security interest in a mortgage note to secure an obligation and to the rights of a buyer of a mortgage note. Generally, the seller or person creating a security interest to secure an obligation must “authenticate” a security agreement describing the mortgage note.
Does the mortgage follow the note?
When a note has been transferred, the mortgage securing it automatically follows. This rule is codified in the UCC section 9-203. The maxim that the “mortgage follows the note” has been followed in most states, including Florida, New York, Ohio, Texas and California.
What is an Article 9 Financing Statement?
UCC1-UCC Financing Statement – this is a Unified Commercial Code form prepared by the company granting credit. When it is filed appropriately it gives public notice that a creditor has a security interest in collateral belonging to the customer documented in the statement.
What is a UCC foreclosure sale?
A UCC foreclosure sale involves the secured creditor disposing of the collateral in a public sale (i.e., an auction), without judicial process. Both The Mark Hotel and 677 Broadway decisions effectively support the notion that a UCC foreclosure sale conducted during a pandemic may not be commercially reasonable.
What is a commercially reasonable manner?
Commercially Reasonable Manner or “Commercially Reasonable” means, with respect to a given goal or requirement, the manner, efforts and resources a reasonable person in the position of the promisor would use, in the exercise of its reasonable business discretion and industry practice, so as to achieve that goal or …